SUBHASH CHANDRA JAIN v. FEROZE KHAN — 1981 DIGILAW 114 (DEL)

CHARANJIT TALWAR ( 1 ) THIS is an application under 0. 39, Rr. 1 and 2 under 0. 40, R. 1. Cml P. C. for grant of temporary injunction and for appointment of a receiver. ( 2 ) THE plaintiff has filed the present suit for declaration permanent injunction and for rendition of accounts against Feroze Khan, director of picture Qurbani, M/s. F. K. International, its producer and M/s. Bobby Arts International its distributors in Delhi-U. territories. ( 3 ) HIS case is that by an oral agreement, defendant No. 1 acting on behalf of defendant No. 2 which is his sole proprietary concern, appointed the plaintiff as an agent for a period of ll years from 7th Aug. 1980, to exploit the picture in the Delhi-U. P. territory (herein called the territory ). According to him under the terms of that oral agreement, because of recognition of his skill and experience he was to carry out the business of distribution of the picture in the territory. The plaintiff was authorised to book the picture and supervise its exhibition in various theatres in the territory. He was required to open an office on behalf of defendants 1 and 2 at his residence, H-68, South Extension. New Delhi. He could also set up an office in the Film Colony, Chandni Chowk, Delhi. The plaintiff avers that he was to be paid a commission at the rate of 20 per cent on the net business of the said picture, the business being distribution, exhibition and exploitation throughout the territory. It was further agreed that the amount of commission was to be paid to the plaintiff every month after accrual of the net collection and that the accounts were to be maintained by the accountants of defendants 1 and 2. All the terms of the oral agreement have been mentioned in para 6 of the plaint. ( 4 ) IN pursuance of the terms and conditions of the agreement, the plaintiff avers, he started the work of distribution and exploitation of the said picture by entering into agreements with various exhibitors of the territory. It is claimed that by his experience and skill the plaintiff secured business of and was able to collect Rs. 45 Lacs on behalf of defendants 1 and 2 but he has been paid only Rs. 1,00. 000. 00 towards his commission. It is claimed that by his experience and skill the plaintiff secured business of and was able to collect Rs. 45 Lacs on behalf of defendants 1 and 2 but he has been paid only Rs. 1,00. 000. 00 towards his commission. His grievance is that towards the end of October, 1980. defendant No. 1 by playing a ruse on him took away from him the prints and the publicity material of the picture. The plaintiff apprehends that as the picture has proved a great success at the box-office, defendants l and 2 illegally want to transfer the distribution rights of the said picture in favour of defendant No. 3. According to him, his apprehension stands confirmed by a circular issued by the Motion Pictures Association on 13th Jan. 1981, which circular has been issued at the instance of defendants 1 and 2. informing the members of that Association that the plaintiff was not authorised in any capacity whatsoever to deal with the picture without prior approval of the said defendants. ( 5 ) HENCE, the instant suit for declaration, permanent injunction and rendition of accounts. ( 6 ) WHILE issuing notices of this application on 23rd Jan. 1981, I had directed the parties to maintain status quo as of 10. 52 A. M. of that day. ( 7 ) DEFENDANT No. 3 has filed reply to this application which is supported by an affidavit of Feroze Khan, defendant No. l, and sole proprietor of defendant No. 2. ( 8 ) IN th? reply, the claim of the plaintiff has been totally denied. It is denied that the plaintiff was, at any time. appointed as a distributor of the picture for the territory. The case of the defendants is that the plaintiff was appointed manager of the second defendant ai a salary of Rs. 5,000. . 00 per month commencing from July, 1980. It is denied that any business was conducted by the plaintiff on behalf of the defendants from his residence. The allegations made against the plaintiff are that in spite of instructions to him not to screen the picture in some parts of the territory because of communal riots, he (the plaintiff) confirmed the release dates of the picture thereby causing huge losses to the distributor. The allegations made against the plaintiff are that in spite of instructions to him not to screen the picture in some parts of the territory because of communal riots, he (the plaintiff) confirmed the release dates of the picture thereby causing huge losses to the distributor. To meet the expenses of the publicity of the picture and in running and maintenance of second defendant s office in Bhagirath Place. Chandni Chowk, Delhi, it is averred that an amount totalling Rs. 3. 23,000 had been paid to the plaintiff in cash and by cheques. Apart from that, an amount of Rs. 1,00,000. 00 which is being claimed by the plaintiff as his commission, was paid to him by the defendant for the cost of publicity and for payment of dues to an exhibitor. Case of the defendants is that although the said picture has proved to be a success in other territories, it has gone into losses in Delhi- U. P. territory due to the sheer negligence of the plaintiff. The loss suffered by the defendant is stated to be to the tune of rupees twenty lacs. ( 9 ) FURTHER, the case of the defendants is that because of the losses which have occurred due to the negligence or want of diligence and skill on the part of the plaintiff, the defendants had to request the Motion Pictures Association to issue circular calling for the dues of the exhibitors payable by defendants 1 and 2. It is further averred that the statement of 28th Dec. 1980, purporting to mention the outstandings of the exhibitors in this territory was prepared by the plaintiff and handed over to defendant No. 1. At the foot of that statement, the plaintiff has declared that he has not received any moneys other than shown in the statement from the exhibitors. It is further averred that with effect from 13th Jan. 1981, defendants 1 and 2 have appointed defendant No. 3 as their distributor on lease-basis in respect of the picture in the territory in consideration of a sum of Rs. 9,00,000. 00. ( 10 ) THE case thus put up by the defendants is that the plaintiff was merely an employee and in that capacity ha is not entitled to the reliefs of declaration and permanent injunction. 9,00,000. 00. ( 10 ) THE case thus put up by the defendants is that the plaintiff was merely an employee and in that capacity ha is not entitled to the reliefs of declaration and permanent injunction. In any case, it is urged, prior to the issuance of the status quo order the distribution rights had been transferred to defendant No. 3 for consideration of rupees nine lacs and as such the plaintiff is not entitled to any rendition of accounts. ( 11 ) TO succeed in this application, Mr. S. N. Sapra learned counsel for the plaintiff, admits that he has to bring his case within the purview of S. 202 of the Contract Act. The plaintiff has to show that as an agent he had himself an interest in the property which forms the subject matter of the agency. If he has an interest in the property then the agreement cannot be terminated, to his prejudice. ( 12 ) FOR the disposal of this application it is not necessary for me to hold at this stage whether any oral agreement was or wag not entered into between the parties on 7th Aug. 1980. I will assume that such an agreement, as referred to by the plaintiff, containing the terms which have been stated in para 6 of the plaint, was arrived at between the plaintiff and defendants Nos. 1 and 2. What, however, is to be seen is whether under that oral agreement the plaintiff had any interest in the property which is the subject-matter of the agency. ( 13 ) ACCORDING to Mr. Sapra, interest of the plaintiff in the subject-matter of the agency was his skill by which the picture was exploited. He does not claim that the plaintiff had any other interest in the prints of the picture or publicity material which have been taken away by the defendants. He submitted that skill of the plaintiff gives him an interest in the prints and the publicity material. The prints and publicity material having been taken away, it is urged, illegally, the plaintiff at this stage is entitled to seek interim reliefs As prayed for in the application. ( 14 ) MR. K. K. Mehra, learned counsel for the defendants has urged that the suit as well as the application are entirely misconceived. The prints and publicity material having been taken away, it is urged, illegally, the plaintiff at this stage is entitled to seek interim reliefs As prayed for in the application. ( 14 ) MR. K. K. Mehra, learned counsel for the defendants has urged that the suit as well as the application are entirely misconceived. According to him on the plaintiff s own showing he cannot be said to have any interest in the property which forms subject-matter of the agency. Therefore, the agreement, If any, can be terminated. In support of his contention, Mr. Mehra relied upon decision in Dalchand v. Hazarimal AIR 1932 Nag. 34. In the said case the plaintiff had appointed the defendant as his agent for the sale of cloth by an agreement which entitled the defendant to retain part of the price of the cloth sold by him as his remunerations. The contract was entirely indefinite as to the time for which the agency was to continue. Jackson, J. C. after analysing the provisions of S. 202 of the Contract Act and discussing the case law on the subject held that the defendant had no interest in the cloth which had been kept with him by the plaintiff for sale. ( 15 ) PRIMA facie the plaintiff herein cannot be said to have any interest in the subject-matter of the alleged agency. His case that because of his skill, he has acquired an interest in the subject-matter of the agency and as such is entitled to exploit and distribute the picture, at this stage, seems to me to be misconceived. Mr. Sapra was unable to cite any authority in support of his submission. ( 16 ) AGENT for exploiting a picture like an agent who is given cloth to sell has to have certain skill to carry out his work as such an agent, in Dalchand s case (AIR 1932 Nag 34) (supra) the agent who had a right to retain a part of the price of the cloth sold by him towards his remunerations was not held to be an agent as envisaged by S. 202 of the Contract Act. The plaintiff, according to his own case, was only to get commission after the accrual of the collection cannot thus prima facie be said to have any interest in the prints of the picture. The plaintiff, according to his own case, was only to get commission after the accrual of the collection cannot thus prima facie be said to have any interest in the prints of the picture. As such he is not entitled to an order restraining defendants 1 and 2 from exploiting or distributing or exhibiting the said picture in the territory. In my view prima facie he is also not entitled to an order restraining defendants 1 and 2 from giving or transferring the rights of distribution, exploitation and exhibition of the said picture. ( 17 ) IT is the defendants case that prior to the filing of the instant suit they had appointed defendant No. 3 as their agent for exploiting, exhibiting and distributing the picture in consideration of the amount of Rupees nine lacs. In view of this categorical averment of the defendants the prayer of the plaintiff for appointment of a receiver to take possession of the prints of the picture, is also liable to be rejected. ( 18 ) ACCORDINGLY, the application is dismissed, but with no order as to costs. ( 19 ) ORDER dated 23rd Jan. 1981, passed by me requiring the defendants to maintain status quo thus stands vacated.